Idaho · LLC tax election
Idaho LLC: S corp or C corp?
In Idaho the corporate rate and the personal rate are the same number, which simplifies the choice.
See Idaho at a glanceShort answer
Idaho taxes both C corporations and individuals at a flat 5.3% (the 2025 rate, the latest published), so the state gives the S election no rate advantage. An S corporation pays only a $20 minimum tax. The case for S corp status in Idaho comes from federal self-employment tax, not state tax.
Last checked .Idaho at a glance
| Question | Idaho |
|---|---|
| S election recognized? | Yes, Idaho follows the federal election1 |
| Separate state form and deadline | none (Form 41S return; attach federal Form 2553 or approval the first year)2 |
| Tax the S corp itself pays | minimum $203 |
| C corp rate and minimum | 5.3% flat4 |
| Personal income tax | Yes, on wages and pass-through income5 |
What is different about Idaho?
Idaho stripped out its brackets. Corporations and individuals both pay a flat 5.3% for 2025, the latest rate the State Tax Commission has published. That makes the state side of this decision plain: whether profit is taxed on the company's return or yours, Idaho takes about the same cut. The S election does not save state income tax, and it does not cost much either. An S corporation pays a $20 minimum tax and files Form 41S, and in your first year you attach a copy of the federal approval or Form 2553. The real reason to elect S in Idaho is the federal payroll tax saved on profit above a fair salary.
Does Idaho recognize a federal S corp election?
Idaho accepts your federal S election, so there is no separate state election. You file Form 41S if you do business in Idaho or are registered with the Secretary of State, and you attach a copy of the federal approval or Form 2553 the first year. The S corporation itself pays a $20 minimum tax. Profit is taxed to shareholders at Idaho's flat 5.3% (2025 rate). The Commission also describes pass-through withholding when a shareholder lives outside Idaho.
Does my LLC need a separate Idaho election or form?
Idaho has no separate S election; in your first year you include a copy of the federal approval or Form 2553 with Form 41S.2
What does Idaho tax an S corp or LLC at the entity level?
- An Idaho S corporation pays a $20 minimum tax.3
Is a Idaho LLC taxed as a C corp ever better?
An Idaho C corporation pays a flat 5.3% on taxable income, the 2025 rate, plus the $20 minimum tax. No brackets, no surtax. The catch is the second layer: dividends you take out are taxed again on your personal return at the same 5.3% for 2025. For a company that pays out most of its profit, that double layer is the main cost of staying a C corporation.
Run your Idaho numbers
Because Idaho's corporate and personal rates match, the state tax is a wash and the S election pays on federal grounds: payroll tax on profit above a reasonable salary. Idaho's own cost is small, a $20 minimum tax and the Form 41S. If profit is thin, that savings may not cover the added payroll and filing work.
Result
How much would a Idaho LLC owner save as an S corp?
| Taxed as | At $80,000 profit | At $150,000 profit |
|---|---|---|
| Default LLC | $11,304self-employment tax $11,304 | $21,194self-employment tax $21,194 |
| S corp | $9,364payroll tax $7,344 + Idaho S corp tax $20 + $2,000 payroll and prep | $15,790payroll tax $13,770 + Idaho S corp tax $20 + $2,000 payroll and prep |
| C corp | $17,404payroll tax $7,344 + Idaho tax $1,696 + federal $6,364 + $2,000 payroll and prep | $30,882payroll tax $13,770 + Idaho tax $3,180 + federal $11,932 + $2,000 payroll and prep |
Assumes a 60% salary7 and a single filer. Income tax is left out. C corp dividends are taxed again. We could not confirm on an official Idaho source whether a default LLC pays an entity-level tax, so none is shown.
When is the Form 2553 deadline for a Idaho LLC, and what if I miss it?
Late relief: federal steps, deadline guide.
What to do next
How to start one, or have us form it from $123.75.
Registered agent $74.25/yr, annual report.
LLC vs S corp guide, election deadline, Form 2553 filed for $165.
More on Idaho: How to start a Idaho LLC · How to start a Idaho corporation · Idaho LLC cost · Idaho annual report · Annual report late fees by state
File the S-Corp Election for your Idaho LLC
We file Form 2553 for a flat $165.
Get the S-Corp ElectionCommon questions
Does Idaho recognize S corporations?
Yes. The Idaho State Tax Commission says Idaho accepts the federal approval of the S corporation election. You file Form 41S and include a copy of the federal approval or Form 2553 the first year.
What is the Idaho corporate income tax rate?
A flat 5.3% on taxable income for 2025, the latest rate published. It was 5.695% in 2024. Idaho also charges a $20 minimum tax per corporation.
Does an Idaho S corporation pay the $20 minimum tax?
Yes. The Form 41S instructions say the $20 minimum tax is required for each corporation that does business in Idaho or is registered with the Secretary of State, and that this includes an S corporation.
Who must file Idaho Form 41S?
An S corporation, for federal purposes, that does business in Idaho or is registered with the Idaho Secretary of State to do business there.
Sources 8 links, checked Nov 6, 2026
- Idaho accepts the federal S election; an S corporation doing business in Idaho files Form 41S. tax.idaho.gov, checked Nov 6, 2026
- Idaho has no separate S election; in your first year you include a copy of the federal approval or Form 2553 with Form 41S. tax.idaho.gov, checked Nov 6, 2026
- An Idaho S corporation pays a $20 minimum tax. tax.idaho.gov, checked Nov 6, 2026
- Idaho taxes C corporation income at a flat 5.3% for 2025 (5.695% for 2024); no 2026 rate was published on the Commission's page. tax.idaho.gov, checked Nov 6, 2026
- Idaho taxes individuals at a flat 5.3% for 2025. tax.idaho.gov, checked Nov 6, 2026
- IRS: Form 1120 instructions, C corp rate irs.gov, checked Nov 6, 2026
- IRS: S corp reasonable compensation irs.gov, checked Nov 6, 2026
- IRS: Form 2553 instructions irs.gov, checked Nov 6, 2026
Last verified Nov 6, 2026.
This page explains the rules; it is not tax advice. Run your numbers with a CPA or enrolled agent before you elect.
Last verified Nov 6, 2026.